Squared Away Blog

One of retirees’ biggest fears is that they will have to go into a nursing home. This fear isn’t just psychological – it’s also financial. Roughly half of older Americans will find themselves in a nursing home at some point, according to a 2015 estimate. These stays usually last months, but sometimes years, and the costs add up quickly for those who have to pay for them out of their own pockets. At an average price of at least $225 per day for a semi-private room, a nursing home stay can put a big dent in retirees’ savings. A new study in the journal Medical Care Research and Review on how much seniors pay out-of-pocket for facilities in eight states…

College upperclassmen and recent graduates have a lot on their minds. One thing they don’t always like to think too hard about is money. Maggie Germano But Maggie Germano, a financial coach, encourages them to get things out in the open and talk about it. At a recent personal finance session here at Boston College, she answered students’ questions about their credit ratings, student loans, and how to avoid spending money they do not have. Here are the five best tips from Germano, a 2009 graduate of the State University of New York in Fredonia. She now lives in Washington D.C. Pay attention. The first step to getting control of one’s finances is to pay attention to them, she said…

Anyone who drives on the nation’s toll roads has used a job-eliminating device: electronic tollgates. Unemployment due to new technologies – and workers’ resistance to them – are as old as the industrial revolution. In the early 1900s, glassblowers were replaced by mechanized bottle makers. Today, autoworkers are no longer necessary to bolt car parts to carriages – robots do it with speed and precision. Toll takers are the latest disappearing breed. Workers who lose their jobs to progress face painful transitions, and pessimists throughout history have warned about technologies increasingly rendering human effort obsolete. Indeed, jobs can seem to vanish overnight after an entire industry or occupation adopts a laborsaving machine, presenting displaced individuals with difficult choices. They must…

Whether you’re having Thanksgiving with family or your celebration will take the form of a Friendsgiving, the staff at Squared Away and the blog’s sponsor, the Center for Retirement Research at Boston College, wish you a wonderful holiday. ……

Retirees could get substantially more in their Social Security check if they would just wait longer – up to age 70 – to sign up. But only a tiny fraction of workers make it to 70, and more than a third get the minimum monthly benefits because they start them as soon as the program allows, at 62. A Bocconi University professor and three UCLA professors have set about trying to change minds by testing 13 ways of encouraging older workers to hold off and lock in a larger Social Security check. The techniques, which they tried on various groups of workers between ages 40 and 61, ranged widely in approach. But two of the most successful tests had on…

In this video, Elena Chavez Quezada introduces two working women in her family who didn’t get a fair shot at a comfortable retirement. Her mother-in-law, a single mother and immigrant from the Dominican Republic, pieced together a living for herself, her parents, and her children. She never had a 401(k) or owned a house. Each time she built up a little savings, an emergency depleted it. Now in her 70s, she is supported by her son and Quezada. Quezada’s aunt possessed the personality of a chief executive but worked as a housekeeper and sold snow cones and hot dogs at her husband’s stand in Albuquerque. After his death, she worked well into her 90s as a receptionist for a hair…

Social Security is a major source of income for most retirees. It is even more important to blacks and Hispanics in a nation that is becoming increasingly diverse. Social Security is helping to even out the racial and ethnic inequities in income and wealth that exist in the working population and continue in old age, according to a study by the Center for Retirement Research for the Retirement and Disability Research Consortium. The researchers estimate how much Social Security reduces this inequality by comparing retirement wealth for white, black, and Hispanic-Americans. Wealth is defined broadly to include obvious things like home equity and financial assets such as 401(k) retirement accounts, certificates of deposit, and money market accounts. In addition, t…

In one significant way, retirement is materially different than it used to be: far more retirees are still trying to pay off their houses. Thirty years ago, just one of every four homeowners in their late 60s to late 70s still had a mortgage – today, nearly half do. Once people hit 80, mortgages used to be extremely rare – only 3 percent had them. Today, it’s one in four, Harvard’s Joint Center for Housing Studies recently reported. Retiree’s financial condition depends on much more than how much they spend on housing – in particular the size of their retirement savings accounts and Social Security checks. But rent or a mortgage payment is typically the largest item in the monthly…

By their early 60s, four out of five workers have chronic health problems. One in four has developed some type of physical or cognitive limitation. If these problems force them to stop working, they can apply to Social Security for disability. But developing a disability late in a career still has long-term financial consequences. These workers not only give up their steady paychecks. Their preparations for retirement are also derailed at a critical time. A 2018 study in the Journal of Disability and Policy Studies quantifies the financial fallout. Four groups were compared, each ranging in age from 67 to 69. One started receiving disability benefits sometime between 58 and 62. A second group went on disability between 62 and…

Perceptions of older workers haven’t caught up with the reality of their increasingly prominent role in the labor force. The federal Administration for Community Living reports that the U.S. population over age 60 has surged nearly 40 percent in just the past decade. By 2030, retirees will outnumber children for the first time in history, the U.S. Census Bureau predicts. The world population is on a similar path. But in the face of this significant demographic shift, discriminatory views of older people persist in obvious and subtle ways. This discrimination colors coworkers’ beliefs about, among other things, older workers’ mental ability, efficiency, and competence on the job, according to one international review of studies on aging. When people think about…

If a 60-year-old baby boomer started saving consistently at the beginning of his career back in the 1980s, he would have some $364,000 in his 401(k)s and IRAs today. How much does he actually have? One-fourth of that, according to a new study from the Center for Retirement Research at Boston College (CRR). One obvious explanation for the enormous gap is that the 401(k) system was in its infancy in the 1980s, and it took time for employers to widely adopt the plans and for young adults to get into the habit of saving for retirement. Another likely reason is the large share of workers who do not have any type of employer-sponsored retirement plan.  This coverage gap, which predates…

The baby boom generation is continuing to work its way up the age ladder. The number of Americans over 80 will more than double to nearly 18 million over the next two decades. And that’s partly because baby boomers are healthier and are living longer – they are also enjoying more of their retirement years free of disability than previous generations.  But unfortunately, boomers can’t avoid the inevitability of their growing vulnerabilities and the impact this will have on their day-to-day lives. A new report by Harvard’s Joint Center for Housing Studies makes some sobering predictions about the issues the oldest retirees can expect to face in the future, from widening income inequality to more people living alone and in…